Coca-Cola has decided not to pursue the expansion of its bottling plant in Prime Minister Narendra Modi’s Lok Sabha constituency of Varanasi on grounds of "inordinate delay" in receiving environmental clearances.

However, activists campaigning against the expansion said the Coca-Cola was "forced to abandon" the newly-built $25 million bottling plant in Mehdiganj, Varanasi, due to their efforts.

"The plant, which was a significant expansion to its existing plant in Mehdiganj - had been fully built and the company had also conducted trial runs, but could not operate commercially as it did not have the required permits to operate," said Amit Srivastava of India Resource Centre.

Coca-Cola required No Objection Certificate (NOC) from the Central Ground Water Authority (CGWA) and the Uttar Pradesh Pollution Control Board (UPPCB).

According to a letter written to UP Chief Secretary Alok Ranjan last week, the company said it had conceptualised expansion of the existing bottling plant and invested Rs. 145 crores in a 600 bottles-per-minute line after getting a conditional clearance from UPPCB. It admitted that the place where the plant is located is categorised as "critical" which required the company to recharge 200 per cent of the water abstracted from the ground.

Accordingly, the company claims to have identified community water bodies that are at various stages of implementation. In addition, 38 rain water harvesting projects are under implementation.

However, the delay in getting the no objection certificate led to financial losses resulting in the company deciding to pull out of the project. At the same time, Coca-Cola has assured that it will explore an option within Uttar Pradesh itself after taking the regulatory approvals. "We will also continue to invest in water conservation and restoration in and around the existing plant," the company assured in the letter to the Uttar Pradesh Chief Secretary.

Activists claim Central Ground Water Authority rejected Coca-Cola’s application on July 21, 2014 and Monday was the day when it was to announce its decision before the National Green Tribunal (NGT), India's green court.

"Somehow having learnt that its application had been rejected, in order to save itself major embarrassment, Coca-Cola sent a letter to the CGWA on August 22 — two days before the rejection was to be made public — stating that it was 'withdrawing' its application," said Mr. Srivastava in a signed statement. He claimed UPPCB had shut down Coca-Cola's plant on June 6 but a stay order by NGT allowed it to temporarily re-open its existing plant on June 20.

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